- Customer Perception
- Customer Needs and Requirements
- Customer Satisfaction Model
- How to Increase Customer Satisfaction
- Treat Your Customers as Important to You
- Create Customer Loyalty to Increase Customer Satisfaction
- Set Customer Expectations Early
- Survey Your Customers to Find the Right Direction
- Track and Monitor Social Media to Help Find Out How to Make Customers Happy
- Kano’s Model for Customer Satisfaction or Customer Delight
- Project Activities in Which the Kano Model Is Useful
- Other Tools That Are Useful in Conjunction with the Kano Model
- Must Be or Threshold
- Performance Attributes
- Excitement Attributes or Attractive Attributes
- Other Attributes
- Application of the Kano Model Analysis
The customer can be defined as the person or group availing of services provided by a company at a reasonable cost. The customer can be categorised into two groups: the internal and the external customer. The internal customers are those who interlink with the organisation, like the marketing department is the internal customer for production department, etc., whereas external customers are those customer who utilise the end-product or services provided by company. Both types of customer are required to sustain long term relationship of the farm. Long-term sustainability of the process depends on customer satisfaction, and customer will be satisfied by the fulfilment of their requirements. In the market, there is a kind of customer with a different perception of quality. According to the TQM philosophy, the customer perception of quality is continuous improvement. This concept emphasises that there is no definite quality level, because the customer’s needs and expectations continuously change with time. We can say that if a company wants to satisfy its customers, it needs to change or update according to customer perception. After completing this chapter, the reader will able to understand customer needs and requirements, the customer satisfaction model, the quality of perception, customer feedback, service quality, and customer retention.
Customer Needs and Requirements
The question arises of what are the customer’s needs and requirements? The needs of the customer are considered to be the problems resolved by the purchase of goods or services. According to CEO of Apple Inc., Steve Jobs, ‘Get closer than to ever to your customer.’ This means the customer should be close to you, so you tell them what they require whether or not they realise it themselves. For successful business, it’s important to know about customers, their needs, quality perception, etc. More knowledge of the customer helps in marketing and sales. Customer information is a powerful tool for planning and implementing. For long-term sustainability development of a company, it needs to know about the customers, e.g., ‘who is the customer,’ ‘the needs of the customer,’ why they want to buy, etc. Here is some brief information to know about customer, such as:
1. Who is the customer?: A person or group of persons that avail of the services provided by the company at some cost is considered a customer. The company should know who is the customer, the customer’s age, their occupation, and gender, and the customer’s perception about your company. All these things help to improve performance of the company and helps marketing and sale.
- 2. Customer occupation: It is important to know the occupation of the customer so that it is easy for production planning, etc. The customer’s occupation is an important factor that influences sale. The customer’s occupation helps to categorise the customer into different categories on the basis of their budget, because these are the main factors that drive production planning.
- 3. Why they want to buy product: If you know the reason for their need of the product, you can easily fulfil the customer’s requirements. That is helpful to business growth.
- 4. When they want to purchase: If the company forecasts when the customer will want to purchase, it helps with scheduling of production. The production schedule can reduce the inventory cost and it’s helpful for just-in-time (JIT).
- 5. Method of purchase: Nowadays customers have more options for methods of purchase, like online, where a customer can purchase through a website. Another is offline, where a customer visits a shop and makes a purchase.
- 6. Budget of customer: A business can grow by matching the product cost offer by the company with the customer budget.
- 7. What gives a customer delight: If you know what can delight a customer, you can serve them what they prefer.
- 8. Expectations of customer: You can stand to gain repeat business if you provide the expected reliable delivery as per customer demand.
- 9. Customer perception toward company: Customers are likely to buy with you if they enjoy dealing with you and get the proper satisfaction. In the case of proper satisfaction, the customer will purchase more items, as well as promoting the products. Customer perception towards the company may be positive or negative, but positive perception helps the business succeed.
- 10. Customer perception of your competitor: It’s important to know the customer perception of your competitors. There are three different categories of this requirement:
- (i) Normal requirements - Requirement that is fulfilled by companies just asking the needs of customers.
- (ii) Expected requirements - This deals with the compulsory requirements. For example, in a coffee shop, if they serve coffee hot, then they have satisfied the customer and if it is served cold, then he is dissatisfied.
- (iii) Exciting requirements - Exciting requirements are beyond the customer's expectations. If provided, the customer would be delighted. If not provided, they will not be happy with the service.
Customer information: Customer information can be gathered in the following ways:
a. By interviews.
b. By survey.
c. Focus groups.
- a) By interview: this process implies some of the following steps:
- • First, make a team which has at least two members. One member focuses on questioning and the other one is listening carefully and taking notes.
- • Prepare notes of everything whether you want to hear it or not.
- • Interviews can be conducted by personal meeting or by telephone.
- b) By survey: these processes include some of the following steps:
- • Prepare a good questionnaire.
- • Mail questionnaire or distribute personally and collect it after response by customer.
- • Analyse all data and draw conclusions.
- c) Focus groups:
- • Prepare group for discussion.
- • Resolve conflicting views.
- • Include a skilled member of the group.
Customer Satisfaction Model
Customer satisfaction can be defined as the product supplied by the company performed the intended function or that it met the measure of customer expectation. J. Willard Marriott (founder of the Marriott Corporation) stated that the needs of the customer may vary, but their bias for quality never does. It is considered an important tool to improve business in any organisation. There are some reasons which are important to customer satisfaction.
- 1. Retaining old customers is cheaper than obtaining new ones: Retaining old customers is most important for a successful business. Retaining old customers is cheaper than obtaining a new customer.
- 2. Customer satisfaction leads to a re-purchase intention: If the customer is satisfied with a given product or service, they have an increased re-purchase intention. It depends on the product features.
- 3. It helps brand recognition: Nowadays, customers help to spread the brand value of the product with the help of the internet and other ways like social media chatting, etc. People respect and like those businesses which provide better customer service.
- 4. It reduces negative impacts in business: It’s directly related to customers’ satisfaction; if customers are satisfied, it will increase the chance of repurchase, as well as new customers. Word of mouth directly affects the business growth. Whether it is bad word of mouth or good word of mouth will depend on customer satisfaction. If the customer is happy with your product and service, then he will give good word of mouth, and otherwise it will be bad word of mouth which increases the negative impact on the business.
How to Increase Customer Satisfaction
Customer satisfaction is most important tool for business growth. To increase customer satisfaction, small- and medium-size businesses must be concentrating on building a customer experience. Some of the methods for doing this are listed below:
Treat Your Customers as Important to You
- • Thank customers for being with you.
- • Know about any help needed by the customer.
- • Sort out any customer problems without delay.
- • Keep promises to the customer about any help.
- • Try to impress your customer as a good service provider.
Create Customer Loyalty to Increase Customer Satisfaction
As per American author and business trainer Jeffrey Gitomer, "Customer satisfaction is worthless whereas customer loyalty is priceless’ (Gitomer, 1998). The primary aim of the company should be to create loyal customers who are not easily influenced by the other companies.
Set Customer Expectations Early
High expectations and ridiculous promises that are made by the companies are the most common mistakes and hence may lower the satisfaction level of the customer.
Survey Your Customers to Find the Right Direction
A customer feedback survey is an important way to know how you are going to satisfy the customers. Personal interview and online questionnaires are some common tools that are used for the survey and it will vary from customer to customer.
Track and Monitor Social Media to Help Find Out How to Make Customers Happy
In the present scenario, social media plays an important role in getting information about customer satisfaction and how it can be improved. The use of social media to monitor the feedback is most commonly used. Customer feedback on social media also helps to know about exactly what customers want and you can make a plan to resolve them.
4.4 KANO'S MODEL FOR CUSTOMER
Kano’s Model for Customer Satisfaction or Customer Delight
The aim is to connect customer satisfaction with the products and being fulfilled by the products. There are several types of requirements that influence ultimate customer satisfaction. The model describes customer satisfaction by classifying product attributes based on their perception by customers and their effect on customer satisfaction. The classifications are used for guiding design decisions.
Project Activities in Which the Kano Model Is Useful
- • Getting information about the needs of customers.
- • Getting information about functional requirements.
- • Developing concepts.
- • Studying the competitive products.
Other Tools That Are Useful in Conjunction with the Kano Model
- • Elicited customer input.
- • Prioritisation matrices.
- • Development of quality function.
- • Value analysis.
The product attributes are divided into three categories:
- 1) Must be or threshold.
- 2) Performance or one dimension.
- 3) And excitement or attractive.
At a given cost that the market can bear, a competitive product meets the basic attributes like maximised performance and much excitement.
Kano’s model of customer satisfication is shown in Figure 4.1.
Must Be or Threshold
Threshold attributes are referred to as the prime requirement that deals with the minimum criteria needed to be met by the services and products. In the case of unfulfilled demand, the product loses their utility for the customer.
Performance attributes is another attribute that might be helpful in improving customer satisfaction. Poor performance of products reduces customer satisfaction. A number of needs asked for by the customer fall into the category of performance.
FIGURE 4.1 Kano's model.
The price that a customer will pay is closely linked to the performance of the prod- uct/service. For example, a customer will pay more for a four-wheeler that has better fuel economy.
Excitement Attributes or Attractive Attributes
These are unexpected and unexplained by customers, but provide a high level of satisfaction to the customer. Sometimes it provides for the unspoken needs of which customers are unaware.
There are some other attributes that are not covered by the Kano Model. For example, a list of parts which are used by a repair mechanic.
Application of the Kano Model Analysis
- • A simplest approach to the Kano Model is to ask two simple questions of consumers for each attribute:
- 1. If the product has this attribute, then rate your satisfaction.
- 2. If not, then rate your satisfaction.
Customers should be asked to rate it on the following scale:
- A) Satisfied.
- B) Neutral (as usual).
- C) Dissatisfied.
- D) Don’t care.
- • In most of the cases a neutral response is obtained for first question and the dissatisfied for the other one because the customer has no idea about that attribute.
- • But performance/excitement attributes are closely related to customer satisfaction or dissatisfaction. A trade-off analysis is also needed against the cost. ‘How much extra would you be willing to pay for this attribute or more of this attribute?’ will aid in trade-off decisions, especially performance attributes.
- • Consideration should be given to attributes that receive the response ‘Don’t care,’ because they are not going to affect customer satisfaction nor motivate the customer to pay higher price.